Dolphin-class submarines are capable of carrying nuclear-tipped missiles, but there is no evidence that Israel has armed them with such weapons.

Dolphin fleet plays crucial role in game of deterrence (Photo: AFP)

Israel already has three Dolphin submarines from Germany - one half-funded and two entirely funded by Berlin, a staunch Israeli ally.

The official, speaking on condition of anonymity because of the sensitivity of the issue, said Wednesday a 2005 agreement between the two nations included an option for another subsidized submarine which was now activated at Israel's request.